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Game Discounts: A High Cost for a Low Price?

We’re in the midst of another huge sale on Steam and it’s as intoxicating as ever. The way Steam uses flash sales, daily deals, user choices, trading cards and other incentives to entice people to keep spending small amounts of money on games is genius. Evil genius? Well, we don’t have to go that far but occasionally concerns are raised about what the increasing prominence of sales in the game industry means for developers.

The acclaimed Axiom Verge, released in March, is not participating in the sale. While other games can’t drop their prices fast enough (I saw one game on sale for less than a quarter), it’s defiantly staying at $19.99. Many have commented on how that seems a bit on the high end for a retro platformer and actually, I can’t recall the last time I’ve paid $20 on Steam for a single game. Have I ever? I’m not even sure. But is the price the problem? Or have we become spoiled by discounts to the point where it’s hard on indie developers?

Dan Adelman, a game publicist who worked with Axiom Verge, wrote a complex essay on the current issues with video game pricing. The whole thing is very interesting and well worth reading, but this was the section that stuck out to me.

“Gabe Newell famously told the world in 2011 that when they reduced their price by 75% their revenue went up by 40x! But if everyone does this, you eventually get a race to the bottom. Players are being trained not to pay full price. I’m as guilty of this as anyone. From bundles to sales, I’ve got well over 200 games in my Steam account, many of which I’ll never play…On the App Store, people agonize over whether to part with 99 cents for a game.”

So how did we get to this point where sales are such a key component in video game sales? I think there are two major reasons. The first is the obvious fact that we’re living in a time of tremendous economic insecurity, with many jobs (especially in the game industry) not paying very well. Large discounts help us feel like we’ve indulged in the joy of getting new games at little risk to our overall financial situation. The other reason is that the prices for major commercial games are out of control. $60 for a new game is not chicken feed and depending on how much DLC is available, you could spend well over $100 to get the whole package. It’s only natural that lots of gamers either try to get previously used console games at a lower price or wait until a major sale to buy a PC version.

With indie games, it’s a much different situation. The prices are already lower than commercial games and when they get cut down to $10 or less, it’s hard to make a real profit unless your game becomes a Shovel Knight-esque phenomenon. Developers feel a lot of pressure to discount their games during these sales in order to attract attention from potential customers, but will enough be persuaded to make it worthwhile? The “race to the bottom” is just another factor working against aspiring devs in the current market.

I’m no economist and I won’t have an answer to this quandary to conclude this post. I just wanted to open this up for discussion. Are sales good or bad for indie developers? Is there a way we could better use them to our advantage? Let’s talk about it in the comments!

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